From the technical side, how do they do it? Presumably to avoid the risk of contamination, it's using the phone's rom flashing interface to grab a ROM image rather than an in-phone backup (the image on this news article lends support to that. (More interesting would be how to set up a phone to erase itself when connected to one of these devices).

Then what about encrypted devices? I suppose the law requiring us to hand over passwords and encryption keys will be exercised more often, unless phone encryption is actually trivial to bypass and break.

Legally, the police have previously had to show prove reasonable suspicion in order to obtain a warrant to seek phone records from the telephone companies. That and the cost and difficulty of sending phones off for professional interrogation to get phone records without a court order have kept the police somewhat honest.

I don't see how any good can come of allowing the police to bypass due process, retain your data whether you're a criminal or not and allow them to go on fishing trips by doing the electronic equivalent of searching one's house without a warrant.